Stockmann on Tuesday confirmed that its department store in Oulu will be shut down by early 2017.Stockmann will launch negotiations with a total of 1,100 employees in Finland over the redundancies of a maximum of 260 positions.

The traditional retailer also confirmed on Tuesday that it will shut down its department store in Oulu by early 2017. “The decision will affect all employees, currently around 230, in the store,” the retailer says in a news release.

The consultative negotiations will concern roughly 1,100 employees in support functions within the retail, real estate and administrative units of Stockmann. “The potential reduction need in Finland is at most 260 people, mainly through ending of fixed-term contracts and lay-offs. The negotiations do not concern sales personnel in the continuing department stores,” Stockmann states.

Meanwhile, Stockmann will proceed with its cost-cutting efforts in Russia and shut down its three loss-making department stores in MEGA shopping centres in Moscow by the end of 2016. The stores currently provide employment to some 700 people.

In addition, the retailer will continue to implement the efficiency programme it launched in February in an attempt create annual savings of 50 million euros.

Stockmann recently reported that its operating profits, excluding non-recurring items, fell 43 million euros into the red last year in the face of weak demand for fashion and home merchandise as well as the economic woes and consequent decline of the rouble in Russia.

Per Thelin, the chief executive at Stockmann, estimated in an interview with Helsingin Sanomat on 2 March that the single biggest mistake contributing to the struggles of the department stores has been that “we have no longer focused on the customer”.

“We must really try to win back the confidence of customers,” he stressed.

Heidi Lämsä – HS
Aleksi Teivainen – HT
Photo: Ville Honkonen